Will Taxpayers Recoup the Estimated $305 Million Spent on Oregon’s Failed Obamacare Exchange?

Oregon’s Obamacare exchange, called Cover Oregon, has decided to move from a state-based exchange to a federally-facilitated exchange, joining the 34 other states that have left exchange responsibilities up to the federal government.

Oregon’s exchange has experienced extreme technical difficulties, including never successfully enrolling one person from start to finish online during the 2014 enrollment period. The exchange board recommends switching to the federal exchange because the costs of fixing Cover Oregon would be too great.

Politico reports that Oregon officials are in Washington this week to meet with CMS officials on the details of the handoff.

But the costs of establishing the state-run Cover Oregon website should not be forgotten. It has cost the federal taxpayers an estimated $305 million in grant money thus far and is the third most expensive state-based exchange in terms of federal grant money—which totals nearly $5 billion across all states.

It is unclear whether the federal government will, or would be able to, recoup any of the millions of taxpayer dollars completely wasted on building Oregon’s exchange—or if anyone will be held accountable for squandering the taxpayer money. In addition, it remains uncertain how much transferring the exchange will cost and whether state taxpayers or federal taxpayers will foot the bill.

Moreover, switching to a federally facilitated exchange may be becoming a new trend among the various dysfunctional state exchanges. Both Massachusetts and Nevada are reportedly weighing their options to switch to a federally run exchange. These exchanges cost the federal taxpayer payer $179 million and $91 million in grant money, respectively.

According to an assessment of Nevada’s exchange options, transitioning from a state-based to a federal exchange for the 2015 open enrollment period requires that a transition blueprint be submitted to CMS by June 1, 2014 (according to federal guidelines). So these states’ exchange decisions will be made soon but there’s still no news on recovering or holding anyone accountable for the hundreds of millions of taxpayer funds that went to these states.

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